2007 (2) TMI 318 - HC - Companies Law

Offences - Against Act to be cognizable only on complaint by Registrar shareholder or Government

Summary

Issues:
Indictment in two separate prosecutions under the Companies Act for failure to submit balance sheet and annual returns, request for cross-examination of complainant, interpretation of section 621(1A) of the Companies Act.

Analysis:
The petitioners in this case faced indictment in two separate prosecutions under the Companies Act, both filed by the same complainant, the Assistant Registrar of Companies, Kerala. The prosecutions were related to the failure to submit the balance sheet and annual returns. The complainant did not testify personally, but a witness, PW1, was examined on his behalf. The accused claimed they were not in possession of the original documents, which were with the Kerala Financial Corporation. When PW1 was examined, the complainant wanted him to be confronted with certain documents, but PW1 expressed ignorance about them. The petitioners sought the court's permission to cross-examine the complainant to confront PW1 with the copies of the documents in their possession. However, the learned Magistrate did not grant this permission, leading to the filing of petitions challenging these orders.

The counsel for the petitioners argued that without the opportunity to cross-examine the complainant and confront him with the relevant documents, there would be a failure of justice. They believed that the complainant, who was the intended recipient of the documents, would not deny receiving them. In light of these circumstances, it was contended that invoking powers under section 311 of the Code of Criminal Procedure, 1973, to make the complainant available for cross-examination was necessary for a fair trial. The court agreed that in the given facts and circumstances, it was appropriate to allow the petitioners to cross-examine the complainant.

On the other hand, the counsel for the respondent relied on section 621(1A) of the Companies Act, which states that the personal attendance of the complainant may not ordinarily be insisted upon. However, the provision allows for the court to require such attendance in suitable cases during the trial. It was argued that this provision did not justify the Magistrate's decision to deny the petitioners the opportunity to cross-examine the complainant and confront him with the documents.

Ultimately, the Court allowed the Criminal Miscellaneous Petitions, setting aside the impugned orders. The learned Magistrate was directed to summon the complainant and provide the petitioners with the chance to cross-examine him and confront him with the relevant documents. This decision aimed to ensure a fair trial and uphold the principles of natural justice in the proceedings related to the alleged violations of the Companies Act.